+1  A: 

You shouldn't use AllowsTransparency="True", it causes a lot of strange bugs and poor performance, if you want funky borders you should do it the old way - calling SetWindowRgn via interop.

Read http://blogs.msdn.com/wpfsdk/archive/2008/09/08/custom-window-chrome-in-wpf.aspx

look at the end at the section titled "Office 2007 without Aero – Or, you are responsible for everything".

Nir
+1  A: 

There is a known bug related to controls popping up behind their parent window discussed in this MSDN post. There is a hotfix for XP mentioned in the article but some people still experience the issue after applying the hotfix.

Robert Macnee